Barack Obama's economic agenda

A little history lesson

NATIONAL REVIEWdenounces the economic agenda booklet the Obama administration released yesterday. "He calls it the 'New Economic Patriotism,'" the editors write, "and if that name seems to you redolent of early-20th-century totalitarians, that may be because it is not the first N.E.P.: Lenin’s was the Novaya Ekonomicheskaya Politika."

Interesting reference! The Novaya Ekonomicheskaya Politikawas a free-market economic reform package introduced by the Soviet government in 1921. It entailed a retreat from an all-state economic model in favour of institutionalised recognition of a legitimate private sector in industry and agriculture, as well as a dramatic tax cut.

The linchpin of NEP was the introduction of a tax-in-kind, set at levels considerably below those of previous requisition quotas, which permitted peasants to dispose of their food surpluses on the open market. This concession to market forces soon led to the denationalization of small-scale industry and services; the establishment of trusts for supplying, financing, and marketing the products of large-scale industry; the stabilization of the currency; and other measures, including the granting of concessions to foreign investors, all of which were designed to reestablish the link (smychka) between town and country. Referring to NEP as a retreat of the state to the "commanding heights of the economy" (large-scale industry, banking, foreign commerce), Lenin insisted that it had to be pursued "seriously and for a long time."

The reforms were largely successful, leading the Russian economy back to pre-war production levels by 1927. But they also led to rising income inequality. After Stalin won the struggle for power in 1928 over alternative leaders like Trotsky, Zinoviev and Kamenev, he soon abandoned the NEP in favour of forced agricultural collectivisation and industrial centralisation under the first five-year plan. He then gradually mopped up every remaining base of political opposition within the party and had them all executed in show trials beginning in 1934.

It's not clear to me what National Review is trying to do by associating Barack Obama with the NEP, its chief advocate Nikolai Bukharin (who coined the Deng Xiaoping-like propaganda slogan "Enrich Yourselves!", and was executed after a show trial in 1938), or the reformist faction that briefly held out the hope of turning the USSR into a relatively normal mixed state-capitalist economy in the 1920s. But I'll take any opportunity to talk about this stuff! There's far too little knowledge of actual Soviet history in today's American political landscape, which leads people to indiscriminately toss out references to anything that had to do with the USSR as a stand-in for "Communist totalitarianism".

It's not clear to you what the National Review intends by associating Obama with the USSR? What?

Here's a story about Soviet history. In one of my classes about Soviet history, which was small, we had a completely party-line Stalinist from India - back when the Indian Communist Party was Stalinist. No matter the material, he parroted the official Stalinist line. The teacher was young and we were friendly outside of class. We were talking in the library lounge and he disclosed he had a problem: he couldn't figure out how to grade or even how to respond to the Stalinist kid's exams and papers. They were 100% wrong factually but 100% right from the Stalinist perspective of his beliefs. He was genuinely confused about what to do.

The class was long before the revelations about Stalin came out. (See Simon Montefiore's The Court of the Red Tsar for a wonderfully readable, horribly sad telling.) What do you do when what you see as fact conflicts with what others see as a matter of belief? When your facts are deemed untrue because belief trumps them?

Think that's only an issue with Stalinists? Look at creationists, especially Young Earthers - who include a GOP representative on the House's Science Committee. Belief trumps facts, bend facts to fit.

The interesting point of the discussion I had with that professor, you see, is that we're always subject to belief. Until recently, the belief was that austerity would work magic. Tax cuts increase revenue and stimulate massive economic growth. Obama is from Kenya. The first was widely shared by governments and economists. The second is not widely shared but is pushed by ideologues as though it were fact. The third is abject nonsense. But they're all beliefs. They all rely on leaping across a gap in logic, on filling in missing facts with favorable ones, on reading facts the wrong way, on ignoring what doesn't fit.

One of my favorite books is a library discard. It's about 100 years old and conveys the idiotic notion that Nelson's victory at Trafalgar was mathematically derived. The author fits a basic equation to the results as proof. No causation, barely any correlation because 1 occurrence is meaningless. Really cool bit of nonsense. But compare that to another favorite book, a defense of show trials in the 30's by a Western journalist who saw them. They looked real. If you wanted to believe in Stalin, you could convince yourself the absurd allegations and absurd confessions were real. One is harmless and the other killed people. Belief trumps fact.

jomiku, I hope you take this as a compliment, but there is absolutely no way I would have guessed, from your earlier posts, that you are old enough to have taken a class on Soviet history before the revelations about Stalin came out. You're talking about Khrushchev's '56 speech?

No. The Indian CP was Stalinist through the 70's. I was in school then. Many people couldn't believe Stalin was a true monster until the archives began to open and historians found lists with Stalin's writing "shoot them all" when asked who should be executed. By the time Montefiore wrote the book I mentioned, the monstrosity was impossible to deny.

One of my professors, Jonathan Spence, had a tough time giving up on Mao. I heard him talk years after school and he was still trying to find excuses. Mao didn't know, etc. It's hard to break down your own beliefs. Then books about the famine came out. Mao was a monster too.

Ah, right. Interesting that the moments people think of as "when the revelations came out" differ depending on the reception within the society they were living in. I'm still surprised in the Netherlands at how many people in my generation say they didn't realise how bad the economic situation was in the East Bloc until they actually visited -- there was no doubt by the '80s in the US even among leftists that Soviet Communism was an economic wreck, whether you'd visited or not. It's not as if the evidence wasn't available in the Netherlands, but the dissemination depends on who counts as a trusted source, and political alignments made "pro-American" information sources untrustworthy for much of the left side of the Dutch electorate in the '70s-'80s.

The National Review and other conservative publications should stop opposing the President or the Democrats FOR THE SAKE OF OPPOSING THEM. They should realize that the Republicans have gone so far to the right that they stand only to enrich their biggest campaign donors rather than for conservative principles such as the free market, simplified taxation, and fiscal conservatism; their stance is the textbook definition of crony capitalism (the Democrats are also guilty, but at least they have sensible policies).

President Obama's booklet contains many ideas that would resonate with the center-right. In any case, he provides a FAR better blueprint than Ryan's plan, which EVEN Newt Gingrich denounced as "right-wing social engineering." Same against Mittens's so-called five-point plan.

When the anchor of the far-right in the mid-1990s becomes too "liberal" for the Republicans, and when Reagan or Jesus Christ would get CRUSHED in today's Republican primaries, you know something is horrifyingly wrong.

Someone who supports DOMA, DADT, welfare reform, financial deregulation, and lower cap gains tax can win the Democratic nomination? Yes, Clinton has moved left along with his party since he was president. But I said that 1990's Bill Clinton could not win the nomination today. If you disagree, you seriously need to get out of that bubble.

You fail to understand the why of those pieces of legislation (which were not generally promoted by him, he just signed them). In other words they don't necessarily represent his views so much as taking steps towards a desired outcome (DADT -> openly gay service), or practicing realistic expectations - he had a Republican congress most of his presidency so things like DOMA and welfare reform get signed (because he was capable of compromise and deal making). Do you have actual proof that he genuinely supported DOMA? I don't remember but it's likely it had veto proof support in Congress anyway.

Ronald Reagan signed a lot of tax hikes, would you say that his position was that taxes should be higher because of that? No. He still couldn't get nominated as a Republican today because he was capable of compromise and raised taxes.

Also, the Dem's haven't moved that far left in the last 20 years, it's just that the Repub's have moved so far to the right that it appears that way.

I agree. Though Reagan could not get the Democratic support today that he did.

I understand why conservatives would want to claim that the GOP hasn't moved much but I don't understand why liberals would want to claim the same about the Democrats except as a way to disingenuously argue that the GOP is getting worse. Liberals should embrace the "progress" their party has made.

Excepting DOMA and DADT, which I agree the Democrats have moved far to the left on, the rest seem to be responses to events, rather than an ideological shift. Financial deregulation was popular on both sides of the aisle, up until the crash. Lower capital gains was a 90s consensus, Social Democrats were doing the same thing, and opinions have only changed on this when the growth didn't occur as predicted. Welfare reform remains a bipartisan consensus, though some believe that the work controls rule should be devolved to the states rather than remain centralized at the Federal level. With a possibility that there should also be exceptions for workfare requirements during recessions, since there is a lot of evidence that the requirements as instituted are pro-cyclical, raising employment during expansions but exacerbating unemployment during recessions.

So I have to disagree that 90s Clinton couldn't be nominated today. Clinton was going along with a technocratic consensus on most of the issues you mentioned, a consensus that began to be questioned by the late 90s and that completely unraveled with the downturn. Clinton would only not be nominated if you assumed he didn't update as new facts came in, which is not a characteristic that describes him well. Technocratic shifts in economic and social understanding are different from ideological shifts.

Clinton still stands by repealing Glass-Steagall. I think whatever little technocratic shift there's been has been more due to ideological shifts. Democratic technocrats are defending their party which has shifted leftward.

One could make similar arguments about the right. Reagan's illegal immigrant amnesty didn't end the problem as had been expected. His grand bargain didn't last. We got the tax increases but not the spending cuts.

The entire country moved left on gay rights. I don't think Dick Cheney counts as a wild-eyed liberal, and he supports gay marriage and (I would guess) gays serving openly in the military. When boxers, football players, MMA guys, and other "manly" athletes have a great and sincere "eh, who cares" at the idea that the sweaty guy punching a bag next to them might be married to someone named Jeff, things have changed.

Glass-Steagall is overrated: it doesn't end Too Big to Fail (both commercial AND investment banks will remain WAY too large) and ignores the rest of the New Deal regulatory structure: that 90% of financial instruments were regulated until the 1980s (subject to antifraud requirements and traded transparently), and that 80% of financial instruments are NOT regulated. That is one of the major lessons from the 2008 crash.

As an addendum: the Dems and Repubs have become VERY polarized in social issues, but the Dems have actually moved RIGHT on economic issues. The ACA is a lot less liberal compared to Clinton's mid-1990s plan (indeed, its framework was pushed by the Heritage Foundation), and the Employee Free Choice Act, which would have slowed the freefall of private unions, wasn't even PROPOSED on the grounds that it wouldn't stand a chance in the Senate. No Cap and Trade. No Fair Elections Now Act. Nada.

And really, economic issues are a much better criterion of left and right because it tangibly affects far more people far more critically.

"Enrich yourselves" was not coined by Bukharin; it's associated with Guizot:

"as a leader of the 'Doctrinaires', committed to supporting the policies of Louis Phillipe and limitations on further expansion of the political franchise, he earned the hatred of more left-leaning liberals and republicans through his unswerving support for restricting suffrage to propertied men, advising those who wanted the vote to 'enrich yourselves' (enrichissez-vous) through hard work and thrift."

M.S., Obviously you'll take any opportunity to talk about "this stuff" !

If you had read past the first paragraph, it would be clear to you that "The President's Ridiculous Pamphlet" is about it's "scant substance." Why is there no DiA critique on this vapid rehash of Obama's first term disguised as a 20-page pamphlet with too many pictures? Because M.S. basically agrees with National Review's conclusion:

If patriotism is the last refuge of a scoundrel, what is economic patriotism? The last refuge of a man with President Obama’s record.

It's not a great plan, at all, but the National Review's take is straight out of the shrillest, most hyperbolic sections of the internet. Even if that's an effective way to appeal to your also-shrill audience, it's sad to see the National Review write like 152nd best blogger on Huffington Post.

MS goes deep into the weeds to attack Romney's economic plan and now we have Obama's, MS defends the title. I hope WW steps up to the plate. I only wish we had more time to mock this Little Blue Book before the election.
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The point of the NRO piece was to mock the pamphlet as everyone is doing.
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Rich Lowry of National Review writing for Politico:
."What the Obama agenda lacks in substance, it makes up in graphic design. The pamphlet has as much gloss and as many soft-focus photos as a copy of Playboy. The seriously besotted Obama fan might have to assure friends, “No, really — I only read the Obama second-term plan for the policy details.”... In an amusing touch, it has a table of contents — as if readers would have trouble navigating the extensive volume."
.Reason.com
."So, in other words, a shiny substance-free pamphlet is a metaphor for the Obama presidency—because these 11 pages of fluff make Romney's tax proposal look like an annotated edition of the Talmud."
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A comment at NRO:
."I found the page with the pop up Big Bird particularly compelling"

According to WSJ via Des Moines Register, the pamphlet forgot to mention two of Obama's second-term priorities. One is immigration reform, which, as we all recall, Obama forgot to address his first year in office.

President Obama doesn't give many interviews these days outside Comedy Central, so it caused a stir Wednesday when editors at the Des Moines Register managed to pin him down and even elicit some news. Specifically, Mr. Obama said he wants to pursue immigration reform in a second term, as well as a budget "grand bargain" with Republicans that includes tax reform.

This will come as a surprise to voters reading the President's just-released 20-page brochure on his second-term agenda, which makes little or no mention of these priorities. Perhaps that's why the White House first demanded that the interview be off the record, making the transcript public only after the Register editor objected in a public blog post.

The Hill has further details on his "grand bargain," formerly known as "sequestration."

President Obama said he is prepared to use the $109 billion sequester as leverage to force action on a grand deficit bargain in an initially off-the-record interview with the Des Moines Register that was released Wednesday.

The president predicted that a $4 trillion deal to reduce the debt would come in the first six months of his second term.

His remarks on the automatic spending cuts are a contrast to comments in Monday night's debate when Obama reassured the public there is no way the sequester will ever happen.

"You can probably be a free-trade socialist or a protectionist capitalist."

I suppose that is a better way to convey the point I was trying to make: that calling economic patriotism "socialism" is simplistic, and there are better ways to make a point than bringing in the USSR.

However, re: the National Review, I suppose I will have to eat my words on that one.

It was the famous socialist, Upton Sinclair, who reminded us that protectionism was a vehicle for the business man to take cash out of our wallets so that he could pay higher wages into our wallets, and that somehow people used to think this made sense.

Despite saying that they are pro-free trade, most laymen Americans are actually not particularly pro free trade. (Not enough economic knowledge I think.)
Obama was simply pandering to most laymen Americans with his "buy American" regulation just like Romney is right now with his China bashing. Now Romney masks his pandering to protectionist thoughts by singling out China, but if any other country such as India or Mexico had a profile as high as China does today in the US, then I'm guessing that he would be bashing India or Mexico too.

I think that we should try to convince the American people that Lichtenstein is destroying the economy, and get them to focus their protectionist Id thataways. That's the closest thing to a solution I can think of. Facts don't seem to work.
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I demand to know why Obamney has been soft on Lichtenstein!

Well many Northern European states, Canada, Australia, and a few other places actually teach economics at the pre-undergrad level. Instead of finding a foreign scapegoat why not just teach economics in school?

What is the secret agenda of Obama? There is another potential danger looming large in the horizon. Obama has authorized joint military exercise with Egypt. After Morsi became president, several alarming changes have taken place. Like Khomeini’s Iran, the whole state has been Islamized. A constitution that codifies religious fascism was hurriedly written. Hundreds of convicted terrorists were released, turning Egypt into a haven for jihadist terrorism. The Muslim Brotherhood and its Salafist allies attacked embassies and US interests (KFC, Coco Cola etc.,) in the newly Islamic-dominated Middle East countries. Morsi, emulating Iranian Ayatollahs, incessantly affirms his identity as an Islamist leader of an Islamist State. He has appointed Isalmist extremists to head the State press and audiovisual media. Just days after a report that the U.S. was sharply cutting its participation in a military exercise scheduled with Israel, U.S. planes landed in Egypt for a joint exercise. Code-named “Eagle Arena 2012,” the exercise will include air and naval forays by US and Egyptian planes and boats, over the country, Sinai, and the Red Sea. According to Egyptian media reports, the purpose of the exercise is to enable Egyptian forces to practice both defensive and offensive tactics. By giving Muslim Brotherhood forces training in offensive tactics, Obama is training jihadists how to attack America and Israel in a future warfare. Egyptian president Morsi, is working to bolster Egyptian ties with the communist Chinese dictatorship while becoming increasingly despotic at home. When America itself is submerged in loans, Obama has announced last month his plan to transfer $450 million in cash to help Egypt’s jihadist Muslim Brotherhood-dominated government which is estimated somewhere between $12 billion and $23 billion. In the new geopolitical scenario, Egypt having intimate ties with Beijing and Moscow and with the emergence of a new axis in the Middle East – Tehran-Cairo-Baghdad-Damascus – it is suicidal for America to train Muslim Brotherhood forces in defensive and offensive tactics. Another term for Obama will make him to strengthen this alliance with Islamist Egypt which will be a great danger to America and Israel.

I happened to agree that his leaflet is political cr@p. I also happen to agree that MS is riling people up.

I am not sure why you have to be so aggressive at me or the post though, I happened to think his article was a relatively clever and witty mocking of mockers and in no way contradicted the view that the leaflet is rubbish.

To be fair NRO's rebuttal has little to do with the main point/criticism that M.S. laid out above, which is:

"Interesting reference! The Novaya Ekonomicheskaya Politika was a free-market economic reform package introduced by the Soviet government in 1921. It entailed a retreat from an all-state economic model in favour of institutionalised recognition of a legitimate private sector in industry and agriculture, as well as a dramatic tax cut."

"The Novaya Ekonomicheskaya Politika was a free-market economic reform package introduced by the Soviet government in 1921. It entailed a retreat from an all-state economic model in favour of institutionalised recognition of a legitimate private sector in industry and agriculture, as well as a dramatic tax cut."

"communism light"? Doesn't sound like it. Sounds more like capitalism with some government, which is exactly what the USA is (and ever has been since its founding) today.

a : a theory advocating elimination of private property
b : a system in which goods are owned in common and are available to all as needed

If it was a joke then it has little logical/factual value and thus not worthy of discussion. Otherwise I was trying to explore the logical value of NRO's rebuttal, which I don't see how amounts to "taking it too seriously."

"an economic system characterized by private or corporate ownership of capital goods, by investments that are determined by private decision, and by prices, production, and the distribution of goods that are determined mainly by competition in a free market"

So yes I believe that the Soviet Union under NEP would be a capitalist state rather than a communist one, even if the government labeled the state as a communist one (in a factually inaccurate manner).

Don't really understand this NRO response either. I certainly don't think Deng Xiaoping would have made a good president of the US, nor would Ronald Reagan or FDR have made good general secretaries of the Chinese Communist Party. Nor would Isaac Newton be a good quarterback of the New York Jets.

The main point is that if you want to make a sneering remark comparing someone to something out of Soviet history in order to imply they're similar to totalitarian Communists, you don't want to pick the most free-market capitalist programme in early Soviet history in order to make the comparison. At a deeper level, perceiving Soviet history in this sort of ill-informed, monolithic fashion makes it easier for people to misunderstand or deliberately distort current American politics.

The last thing you want in a quarterback is some guy sitting around the locker room sliding metal rods along the edges of his eyeballs and saying "Look, see! I deformed the lens of my eye right there!"

Well except for the egregious lies and lack of ANY detail, the pamphlet is great. Quickly I'll give one clear example of an egregious lies. In the glossy pamphlet, there is this asinine Obama quote:

“Asking a billionaire to pay at least as much as his
secretary in taxes? Most Americans would call that
common sense.” – President Obama

There is NO billionaire living in this country paying a lower Federal Income tax than his secretary. This is ridiculous. The truth of what the President MAY have been trying to say, unsuccessfully, was a billionaire MAY pay a lower Federal Income Tax RATE than his secretary even though the billionaire is paying millions in Federal Income Tax while his secretary is likely paying thousands.

These blatantly dishonest statements intended to create class warfare for purely political reasons are disgusting.

You are also blatantly dishonest for confusing company tax with personal tax. The billionaire owned a company and the company is paying millions in company tax is not the same as the billionaire himself is paying income tax at the same brackett as his secretary.

Sigh. Yeah, of course this means Obama is a socialist/communist/Marxist.
Stephenie Meyer wrote a book titled "Twilight" about glittering vampires, so she's obviously practically the same in ideological outlook as Elie Wiesel, who also wrote a book titled "Twilight". I don't know, maybe she is, but to imply so based on book titles is... baffling, to be polite

That would be around mid-2002 or so, when opposition to the Patriot Act or any votes against various wars became akin to siding with terrorists. I suppose the official date could be chosen as the day French Fries became Freedom Fries.

Democrats really don't get it when Republicans aren't being serious. Pointing out that Obama's pamphlet sounds a lot like Lenin's was a "isn't that funny?" Many commenters are taking this way too seriously. Lowry also likened the pamphlet to Playboy. You don't need to read more into that analogy. Incredible how much ink is spilled analyzing throw-away lines. Sure, we get a kick out of watching the clueless pull their hair out but it's also kind of sad that the two sides aren't even speaking the same language. It's like the Republicans are speaking English and the Democrats are speaking Russian or North Korean or Cuban.

"Democrats really don't get it when Republicans aren't being serious. Pointing out that Obama's pamphlet sounds a lot like Lenin's was a "isn't that funny?""
Please. After 4 years of the right saying Obama's a socialist etc., you expect anyone to believe that (of National Review)? If the comparison had been in a forum, National Review would have been called a troll.
I do get the Democrats speaking Russian etc. Droll. But, you meant to say the Republicans are speaking American.

I read what he wrote in its entirety, and while it's clear he was trying to be snarky in some of his descriptions, it was intended by snarky + insulting. In other words, it's HIGHLY unlikely he wanted to describe Obama's program as pro-free market.
In context, it sounds VERY much like he wanted to imply Obama's plan was leftist (using what he thought was joking hyperbole by comparing it to a "Stalinist" reform), and he completely screwed it up since he didn't realize that the alluded to Stalinist program was a actually free-market reform.
In other words, what you're doing comes across suspiciously like someone making a mistake when trying to draw an analogy, and then excusing the mistake by accusing those who corrected you as "not getting the joke," "taking things too seriously," etc.
Also, you'll have to forgive us "Democrats" for holding the National Review to higher factual standards than "The Onion."

Democrats insist on using an archaic definition of "socialism" that would exclude Europe's self-described socialists but that's a whole other issue.

For years, Democrats really believed that half or whatever of Republicans believed Obama was born in Kenya. I think most Democrats have wised up and now are just embarrassed to admit that they fell for it. But it looks like most haven't really learned their lesson.

I had no problem with MS pointing out that the Leninist analogy may not work though that kind of misses the point of the analogy. I did have a problem with MS not writing about the substance, or lack thereof, of the pamphlet but that's another matter. But the point is that, it obviously wasn't intended as a serious policy criticism. That came later in the post.

Sure, I can forgive Democrats for lacking a sense of humor but don't blame Republicans for that.

Or whatever is a big error bar. I always believed a nutty fringe believed it (of which I have several from my college days, giving me pause about the fringe part), and that the right power structure, which I don't think believed it, was perfectly willing to exploit and promote it. They'd often give them themselves plausible deniability by couching answers in phrases like "I take him (Obama) at his word" or such.

As for socialists in Europe, I don't know which (seriously) socialists in Europe your referring to. Methinks they come in different flavors and extremes, so I refrain from further comment on that.

As for parts of government being socialistic, I don't know why Americans, especially on the right, get such a bug up their you know what. It's not the civilization ending concept many think it. Anybody in the U.S. military and their dependents are totally submerged in the most socialistic organization in the U.S. It's all taxpayer funded, with housing, health care, schools that are bought, owned and run by the government.

You're right that both sides need to embrace the word "socialism" more. I once called the USPS socialist in a comment and was bombarded by Democrats calling me a right-wing fanatic who doesn't know what socialism means. The USPS, the military, and public schools are socialist.

Well, Marxist state free worker paradises, and the 'conservative' the concept of a purely individualistic civilization are equivalent and as such equally grounded in reality. The problem is that the term is historically and politically charged.